Crisis In The Gulf Could Be A Plus For Egypt And Turkey

September 05, 1990|By Timothy Harper.

Over the past month, President Hosni Mubarak of Egypt has consistently warned his Arab neighbors that they will all be losers if the Middle East crisis deteriorates into a shooting war. What he hasn`t mentioned is that his own country-along with Turkey, which has also emerged as a staunch American ally in the region-has much to gain from the turmoil.

After spending three weeks this summer-before Iraq`s invasion of Kuwait-researching economic and political stories in Egypt and Turkey, it is evident that the crisis presents not only danger but also opportunity for these two countries.

In Egypt, leading politicians, academics and business executives have generally supported Mubarak`s efforts to transform the country`s sluggish, state-dominated economy into a privately oriented free market. But many fear that the ``privatization`` effort is too little and too late, given Egypt`s overwhelming economic problems.

This is a country whose 55 million people have per capital earnings of barely $600 a year, and yet the foreign debt is $50 billion-approaching $1,000 per citizen. The only way for Egypt to pay off those debts is to earn more than it spends, yet in 1990 Mubarak himself estimates that the country will have $10 billion worth of imports compared with only $6 billion in exports. Egypt`s immediate problems are intensified by the fact that up to $1 billion of those ``exports`` were remittances from the thousands of Egyptian workers who had been in Iraq and Kuwait; instead of sending money home every month, they are now back in Egypt as refugees.

On top of the grim economic figures, the attention and interest of the United States and other Western nations have been diverted from the Middle East toward Eastern Europe. Egypt`s fear was that American government loans and grants that might have come its way, along with trade and investments from the American private sector, would go instead to emerging European democracies such as Poland, Czechoslovakia and Hungary.

Saddam Hussein, however, has shifted the West`s attention back to the Middle East. The more than $2 billion in U.S. aid to Egypt this year now seems like a small price for the way Mubarak has stood up to Hussein and rallied the other Middle East moderates to support U.S. policy. There is even talk in Washington and Cairo of Congress showing its gratitude by writing off the $6 billion Egypt owes the U.S. for weapons purchases.

And many American industrialists and financiers are relishing the notion that American military intervention will guarantee low world oil prices for the rest of their lives. The instability in the region may keep some companies out of the smaller Persian Gulf nations, but Egypt-an oil producer, but not a member of OPEC-has stamped itself as the future place for the West to do business in the Middle East.

This is not to say there are no risks for Egypt and Mubarak, even if there are no shots fired. Politically, he risks further outraging the Islamic fundamentalists in his country who already regard him as an enemy. The radical religious right presents the same threat to Mubarak that resulted in the assassination of Mubarak`s predecessor, Anwar Sadat, for his conciliatory stance toward Israel.

At the same time, American aid, grants and loans in response to his anti- Iraq stand could improve the dire economic conditions responsible for much of the public dissatisfaction that has fueled the growth of the fundamentalist movement in Egypt.

Turgut Ozal, the Turkish president, has many problems similar to Mubarak`s. He, too, is promoting a shift to private enterprise to spur economic growth. And he faces not only the threat from religious fanatics-a group called Islamic Revenge murdered a newspaper columnist who criticized the fundamentalist movement-but has also been plagued by rumors that the military might overthrow his government because of inflation and unemployment.

As a way out of his woes, Ozal doesn`t simply want more money and better relations with the West; he wants Turkey to be part of the West. Less than 5 percent of Turkey`s land mass is in Europe, and it is also a Moslem nation with a growing fundamentalist movement. Yet Turkey is an associate member of the European Economic Community, and it sees full EEC membership as a means of raising the standard of living.

By cutting off Iraq`s oil pipelines in the early days of the Kuwait occupation, and later through military cooperation such as allowing U.S. F-111 bombers to use its bases, Turkey is taking large steps to counter the traditional argument from Western Europe nations that it isn`t really a

``European`` country and therefore should not be part of the EEC. U.S. support for Turkey`s EEC bid probably wouldn`t ensure membership, but it certainly wouldn`t hurt.

Mubarak and Ozal are gambling that their pro-Western policies eventually may help ease their countries` economic problems and enhance their chances of survival-in politics and in life.